Target Market Determination

NEXT PERIODIC REVIEW DATE: 15 MARCH 2024

 

Elevare Pay Easy Pty Ltd A.C.N. 634 728 591 (Elepay) (we, us or our) issues PayLater products to Australian Property Owners and we are committed to maintaining a consumer-centric approach throughout our product design phase, distribution and sales channels, and monitoring and review process.  This Target Market Determination (TMD) is effective as at 15 June 2023.  

 

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1.  Purpose of this TMD

 

This TMD has been prepared by Elepay for its ‘107 Product’ in compliance with our Design and Distribution Obligations under Part 7.8A of the Corporations Act 2001 (DDO).

 

This TMD sets out the class of consumer for which the 107 Product has been designed having regard to the objectives, financial situation and needs of consumers in the product’s target market. It includes the following:

 

• product features and class of consumers that fall within the target market;

• distribution conditions, restrictions and sales practices that are likely to direct distribution of the product to the target market;

• information relating to reviews and monitoring of the product and this TMD, including specifying timing for periodic reviews and review triggers (i.e., the events or circumstances which would trigger a review);   

• how we deal with significant dealings.

 

This TMD does not offer a comprehensive outline of the 107 Product’s terms and conditions, nor is it a substitute for obtaining independent legal or financial advice. Consumers should read the full terms and conditions before applying for the 107 Product.

 

 

2.  Background to the 107 Product

 

The 107 Product is part of a suite of PayLater Products Elepay offers to Australian Property Owners who anticipate that a monetization event will occur in the foreseeable future (primarily, the sale of real property but may also include the refinance with a third-party lender).

 

An “Australian Property Owner” includes:

• any person or entity who is a registered proprietor to real property held in Australia (Owner);

• any person or entity who is an appointed representative of an Owner (e.g. appointed attorney or executor of a deceased estate); or 

• any person or entity who has the express consent of the Owner to acquire the 107 Product relating to the Owner’s property (for example, Elepay may require the registered proprietor to sign a Deed of Consent).   

 

The primary objective of the 107 Product is to allow these property owners the opportunity to better manage their cash flow by allowing them to defer any upfront property-related expense until the occurrence of the monetization event.

 

To offer the 107 Product, we have partnered up with a number of styling companies, pre-listing companies, renovation companies and real estate agents to allow property owners to defer payment of expenses relating to:

• home renovation and improvement;

• marketing and advertising;   

• property styling (to sell) and interior design; and

• other property-related works

       (Sale Costs).

 

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3.  Class of consumers that comprises the Target Market

 

Elepay’s 107 Product is designed exclusively for consumers who meet our Eligibility Criteria and who wish to defer payment of their upfront Sale Costs associated with Elepay’s approved 107 Partners on the basis that there is a foreseeable monetization event (Target Market).

 

CLASS OF CONSUMERS WITHIN THE TARGET MARKET

 

The 107 Product is for the class of consumers who:            

• falls within the definition of Australian Property Owner (see above) and require short-term lending solutions to pay Sale Costs;

• are seeking finance with flexible payment options, capped fees and interest for the term of the loan, ability to make early repayments without additional charges, and a maximum amount of funding capped at the amount of the Sale Costs; 

• are receiving product or services and incurring Sale Costs through our 107 Partners;

• otherwise meets Elepay’s Eligibility Criteria (set out below);

• are not currently experiencing financial hardship;

• are able to make a single lump sum payment for the loan amount (via the funds received from the monetization event) without causing financial hardship.

 

EXCLUDED CLASS OF CONSUMERS

 

The 107 Product is not suitable for consumers who:

• do not fall within the definition of Australian Property Owner;

• are not receiving product or services and incurring Sale Costs through our 107 Partners;

• do not otherwise meet Elepay’s Eligibility Criteria;

• are going through bankruptcy or are experiencing, or are likely to, suffer from financial hardship;   

• are considered vulnerable persons (e.g. suffering from any form of cognitive impairment);

• require an ongoing line of credit;

• require a redraw facility;

• are not comfortable with providing security over their real property.

 

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Eligibility Criteria and Other Product Key Attributes

 

ELIGIBILITY CRITERIA

 

To be eligible for the 107 Product, a consumer must satisfy the following requirements:

• be an individual aged 18 years or above;

• fall within the definition of Australian Property Owner (see above);

• have an anticipated monetization event (for example, proposes to sell their property within the foreseeable future). Elepay may offer the product based on other monetization events (e.g. refinance from a third-party lender) subject to an individual assessment of the consumer’s circumstances;

• if the monetization event is the sale of the consumer’s property, then meets Elepay’s Property Sale Equity Analysis, which ensures that the consumer has sufficient net equity to repay the loan upon the sale of the consumer’s property without causing financial hardship. The consumer will not be subject to an income serviceability assessment.

• Elepay will request details regarding the sale of the property (to ensure that there is sufficient net equity and the consumer proposes, or are actively taking steps, to sell their property). This includes, but is not limited to:

  • details of the proposed sale – e.g. listing date and expected sale price;

  • details of the appointed real estate agent and conveyancer or solicitor;

  • details of any registered co-owner(s);

  • a copy of a recent mortgage statement;

  • a copy of the real estate agent sales appointment form;  

  • a copy of the contract of sale (if available);

• meet Elepay’s standard lending criteria including:

  • conducting a credit check on the consumer;

  • conducting an identity verification check on the consumer;

  • conducting an ownership check (e.g. title search of the property);

  • conducting an online property valuation report (for the property);

• be incurring Sale Costs through our approved 107 Partners of a minimum amount of $100.00.

 

OTHER KEY PRODUCT ATTRIBUTES

 

Other key attributes of the 107 Product are:

• Structure – the 107 Product is structured so that:

  • Elepay enters into a loan with the 107 Partner for a period of 45 days, under which Elepay disburses funds directly to the Partner for the agreed Sale Costs incurred by the consumer (from the Partner);

  • Elepay enters into a loan with the consumer upon expiry of the loan to the Partner (i.e. day 45) and the loan term with the consumer is for a period of 62 days;

  • the consumer has in total 107 days from the Elepay Start Date to repay the loan – i.e. the date Elepay, the Partner and the consumer agree to the funding arrangement associated with the Partner’s Sale Costs.

• Purpose of loan – the 107 Partner must be providing products or services to the Consumer and the loan must be for the payment of the Partner’s Sale Costs (whether partial or in full);

• Repayment – the consumer is required to repay the loan amount via a single repayment on the earlier of (a) the settlement date (if the property is sold) and (b) the scheduled repayment date (being 107 days from the Elepay Start Date), though early repayment is possible without penalty (see below);

• Partner’s goods or services – the Partner has an obligation under the Elepay 107 Partner Agreement to supply goods and services to the consumer with reasonable care and skill and in accordance with the supply terms between the Partner and the consumer;

• Fee Structure – the Fee structure for the 107 Product is as follows:

  • Plan Fee – a capped and fixed Plan Fee of 5.00% of the loan amount;

  • Interest – interest capped at 1.95% of the loan amount and subject to a discount in accordance with the following:

    • If plan paid (in full) between Days 0 and 15 of the consumer loan term, no interest will apply;

    • If plan paid (in full) between Days 16 and 30 of the consumer loan term, a discounted interest rate of 1.00% of the loan amount will apply;

    • If plan paid (in full) between Days 31 and 62 of the consumer loan term, the capped interest of 1.95% of the loan amount will apply;

  • Partner Fee – the Partner is required to pay a partner fee of up to 1.95% of the consumer’s total loan amount. This fee is payable under a separate agreement between Elepay and the Partner;

  • No Establishment or Administration fee – the Consumer is not required to pay any plan fee or interest for the provisions of credit;

  • Default/Late fee – the consumer will be liable to pay a late interest of 0.0695% per day compounding daily (of the outstanding amount) and a late fee of 0.25% every 30 days (of the outstanding amount) if the consumer has not repaid an amount owing by the scheduled repayment date. This is subject to any claim the consumer may have for financial assistance;

  • Other fees – other fees may apply such as a missed payment fee ranging from $15.00 to $25.00 (depending on the method of payment nominated) and title registration fee ranging from $350 to $1,100 (depending on whether a registered security is provided with respect to the consumer’s property);

• Minimum Credit Limit – the minimum amount of funding provided is $100.00;

• Maximum Credit Limit – subject to an individual credit and lending assessment for a particular consumer, the amount of funding provided is capped at the Sale Costs agreed between the consumer and the 107 Partner;

• Early repayments – Consumers have the ability to make an early repayment of the loan without any additional charge or exit fee. The consumer will be entitled to a lower interest rate if the loan is repaid early (see Interest fee structure above);​

• Security – the consumer will be required to provide a charge over the consumer’s real property (which may or may not be registered against title to the property).  

 

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4.  Consistency between the Target Market and the 107 Product Key Attributes

 

Set out below is our assessment of the likely objectives, financial situation and needs of the Target Market, and the key product attributes of the 107 Product.